Friends, our time together is coming to a close. I'm leaving Yahoo Finance next week. There isn't a mystery here. You won't find any hidden "car people" or conspiracies. This was my decision and it was made months ago. After four years, hundreds of segments and tens of millions of your clicks it's simply time for me to move along to other challenges.
I'm leaving you in good hands. In fact, as timing would have it, Warren Buffett, the unquestioned master of investing, both in practice and teaching others how to think about money, is releasing his annual letter to shareholders in the morning. I started teaching myself how to invest with Buffett's letters some 30 years ago. Tomorrow morning at 8am I'll be pouring a cup of joe and reading Buffett along with everyone else on Wall Street. If you have even a passing interest in finance I encourage you to do the same.
Newbies get a gentle introduction to investing accounting in the notes, but it's only after you master those basics that the letters come to life. Anyone can learn how to build a balance sheet. While Buffett is brilliant, his real gift - and what made him arguably the richest man on Earth - is his utter belief in his own exceptionalism. Buffett plays by his own rules. He gets away with it because he sets standards for himself that are far higher than the laws and regulations that apply to mere mortals.
In 2008 when Buffett famously "bet on America" by investing $5 billion in Goldman Sachs (GS) he left out the part where he bought preferred shares priced at a discount, paying a 10% dividend and offered only to him. Because of those provisions, Buffett's stake in Goldman is up about 200% more than anyone who thought they were buying alongside him. I rather doubt Buffett sees why that taints his legend any more than the donut-center-sized tax loophole he exploited when he funded Burger King's (QSR) Tim Horton's buy last year. He had a unique opportunity and he took it. I would have done the same.
Buffett's self-belief is his foundation. It allows him to fail without for a moment thinking himself a failure. In fact, Berkshire Hathaway (BRK-A) is one of the most successful companies in history, but it's named after one of Buffett's earliest follies. Berkshire Hathaway was the name of a textile mill Buffett started buying shares of in 1962. He's said it's his single biggest mistake, costing him more than $200 billion in compound returns over the last 50 years.
A lot of guys would try to hide that. Buffett just kept the name of the company and started moving his cash into insurance where the cash flows were much better. The rest is capitalist history, myth and just a dash of hokum.
It's said you learn more from failures than success. The only thing I'd add is that it's best if the failures are those of other people. So, sure tomorrow I'll be looking to see if Buffett has anything to say about the IBM (IBM) or Tesco (TESO), the British retailer that's cost Berkshire more than $700 million in the last two years.
But what I enjoy most about Buffett is the absolute glee with which he embraces his status as Oracle. In a way that charisma is why I got into investing in the first place. See, I met Buffett at a birthday party in in 1992. He was just a run of the mill billionaire then and it was a pretty star studded but intimate affair. What's more, even then Buffett was a dead ringer for Carl Frederickson, the old guy in "Up." It didn't matter. Buffett's command of the room was absolute even, and especially, when he grabbed a ukelele and sang a memorably awful rendition of happy birthday.
I've thought about it for years but only recently figured out at least a little bit of what it was that made that weird old guy so compelling. It's that he doesn't fear failure or success. Marianne Williamson wrote that our greatest fear is not that we are inadequate but that "we are powerful beyond measure." By overcoming that fear and letting our own light shine Williamson suggests that we unconsciously liberate others to do the same.
That's the key. Whether it's as an individual or part of an organization, your challenge is to have the courage to be as great as you can be. To share your gift, whatever it is. When you do that you'll find you can handle losses more rationally. You'll be able to influence others positively. You'll be better at everything, including and especially investing.
I've taken a few laps through life. As Dusty Rhodes said, "I have wined and dined with kings and queens and sat in alleys eating rice and beans." The smartest thing I ever did, the hardest thing I'll ever do, was coming out of the shadows and rebuilding my relationship with you folks. Trust me when I say there is no trade you can't overcome. Embarrassment is a waste of time. That's the real key to Buffett's success and life itself. That's the lesson I want you to lock in your hearts and heads. Along with it I'll add one thing: Thank you. All of you. Even the haters for being part of this weird journey. We'll see each other soon.
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